Arctic Yearbook 2014 - Page 504

504 Arctic Yearbook 2014 Melting Ice Opens Northern Waters Today, no submarine optical fiber cables lie on the Arctic Ocean floor, despite this being the shortest way to link Asia, the United States, and Europe by water, a distance of some 16,000 km. To date, ice and icebergs have sufficiently hampered navigation to make cable laying a dangerous prospect. However, the accelerated melting of the polar ice cap opens new prospects, not for raw materials or new maritime routes for commercial shipping, but for telecommunications companies to open the Northwest (NWP) and Northern Sea Route (NSR). The latter route is as much as 7000 km shorter than the NWP, which means not only less cables to lay, but also a shorter latency for communications. This latency gain is of high interest to financial institutions (Clayton, 2012), particularly those involved in high frequency trading (Morand, 2012). Russian and Canadian projects are promising latency reductions of 30%, which represents a gain of 62 milliseconds, going from the current 230 milliseconds to 168 milliseconds.2 Given that milliseconds can mean the loss or gain of millions of dollars (Anthony, 2012), there is little wonder that the new plans for Arctic cable have attracted the interest of traders. The Arctic route has other advantages as well. Since the region has yet to be developed, there is for the moment little commercial shipping or fishing, which reduces the risk of damage to cables from anchors or fishing lines, as was the case off the coast of Egypt (Saffo, 2013). The Arctic route also avoids high-risk security areas such as the Suez Canal or the Strait of Malacca. The Arctic is seen as a stable area for development. Indeed, despite a few (managed) border disagreements between Canada and the US, and Canada and Denmark, and despite the RussianCanadian diplomatic tensions in the context of the Ukrainian crisis in 2014, nothing today points to an armed conflict or a military crisis in the Arctic.3 Three Major Optical Fiber Submarine Cable Projects Polarnet In the early 2000s, Polarnet, a Russian company, was created to lay a 15,000 km fiber optic cable along the NSR. This project, named R.O.T.A.C.S. (Russian Optical Trans-Arctic Submarine Cable System) would link Tokyo to London via Terberka, Anadyr and Vladivostok. The first phase of work is evaluated at $860 million and would connect London and Tokyo via the NSR. The second phase, evaluated at $500 would connect Russian Arctic regions to the cable. A final phase, also evaluated at $500 million, undertaken in partnership with the Russian oil company Transneft, would develop terrestrial connections to the cable in Russia. This brings the project total to $1.9 billion. According to Interfax, the R.O.T.A.C.S. is financed by the Russian oligarch Oleg Kim, already present in many sectors of the Russian economy. However, despite receiving approval from the Russian Intergovernmental Commission for Information and Communications Technologies in October 2011, and receiving financial support from the Ministry of Telecommunications in January 2013, no information is available about the status of the project (Telegeography, 2013). According to the think tank Telegeography (2014a), the cable will be in service in late 2016. Delaunay